The Mercure Crocodile hotel in Jabiru. Locals fear tourism will suffer if the town is rehabilitated.
Photograph: Nikki Marshall for the Guardian

Jabiru is a small town on a countdown.

Deep inside Kakadu national park, the tiny network of bush-lined streets and a tired shopping precinct was originally built in 1982 to service the community of workers from the Ranger uranium mine. It remains home to just over 1,000 people, a quarter of whom are Indigenous, and serves as a hub for more than 300 people living on nearby outstations.

It has also grown to become a base for the 210,000 odd tourists who visit Kakadu each year, many of them staying at the smattering of caravan parks and crocodile-shaped hotels on their way through.

But Energy Resources Australia is required to wrap up its operations and rehabilitate the site when its lease expires in 2021, after losing the support of its parent company, Rio Tinto, to open another mine.

Australian dig finds evidence of Aboriginal habitation up to 80,000 years ago

Read more

That means returning the land – including Jabiru – to a pre-mine state, taking the electricity and airport with it.

Almost no one wants the town to be fully rehabilitated, but in the absence of an alternative plan, ERA is continuing with its obligations to shut it down within four years.

“There is still uncertainty about the future and while there may be a widely held view that Jabiru can have a future beyond 2021, it is not yet known what that might look like, what changes may take place or when,” says ERA chief executive Andrea Sutton.

“What is known is that the current lease arrangements require ERA to undertake various rehabilitation activities in the town. ERA needs to plan for this.”

Jabiru was built to house workers at Energy Resource Australia’s Ranger uranium mine. Photograph: Reuters

Last week ERA released the findings of its social impact study, commissioned to assist in a smooth transition to whatever comes after Jabiru as it is now.

It held 38 stakeholder meetings during its study, and found an “overwhelming” view that Jabiru should have a future beyond 2021. Among respondents there was widespread concern about the displacement of Jabiru’s residents, the hit to its non-mining economy and the loss of services – including health and education – to nearby communities.

The uncertainty is already having an impact, with a number of businesses having closed their doors in recent years, unable to secure loans or find buyers without a guaranteed future.

The West Arnhem Regional Council has provided assurances that it will remain in the region, servicing the Indigenous communities.

“Jabiru is the town in this region. There’s nothing else between Coolalinga [near Darwin] and Gunbalanya [in Arnhem Land],” says Justin O’Brien, chief executive of the Gundjeihmi Aboriginal Corporation.

Gundjeihmi, which represents the Mirarr traditional owners of the park, is working with the federal and territory governments, and ERA, on an alternative plan for the town.

O’Brien is optimistic, and says ERA’s study was based on “full demolition” scenarios.

“They are a narrow focus on what would occur if nothing else happened.”

Last year the Mirarr were legally recognised by the federal court as the native title holders of the land Jabiru sits on, and are negotiating a township lease.

“The clearest way to get security of tenure for residents and businesses and to stop the clock on the bulldozers is to negotiate a traditional owner-led township lease,” O’Brien says.

Northern Territory holiday guide: the heart of Australia

Read more

“There’d be no permit system, it would mean security of tenure, and probably wouldn’t mean a hell of a lot of difference to most people.”

The corporation, through the Northern Land Council, is negotiating a township lease with the federal government, and O’Brien says they would talk more to other stakeholders once the talks concluded. But he says businesses had informally indicated they would be happy for the security such a lease might bring.

O’Brien says it would be unlikely Jabiru would grow – it will lose its mining workforce, but hopes to retain service providers – but he hoped it would become more welcoming.

“At the moment it’s a very insular, inward-looking mining town built in the 70s and 80s,” he says.

“It’s like a small country town, a very different place with a very different cultural mix, with Aboriginal people and non-Aboriginal people, and a big mine.

“But that small country town feeling we hope to keep, and make it a better place for visitors to come to.”

The airstrip, connected to the Ranger mine, has a future three years longer than the town under the current closure plans – it would be demolished in 2025. If it disappeared it would be devastating for the tourism industry, O’Brien says.

“Jabiru and Kakadu might not be kicking the goals in tourism we think it could and should be, but it’s all that’s on offer at the moment. In the peak season it can be difficult getting a bed.”

Bob McDonald, director of Kakadu Air, which has operated from the Jabiru airstrip running scenic flights over Kakadu for 36 years, declines to talk about the report, but tells Guardian Australia he is “extremely optimistic” and the current planning is “a great opportunity for the normalisation of Jabiru”.